Inflation - live: Boris Johnson accused of being on ‘shore leave’ as UK faces recession
Inflation rate of 10.1 per cent puts further strain on households across UK
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The UK rate of inflation has hit 10.1 per cent, the highest level in 40 years.
The increase was largely down to food prices and staples including toilet rolls and toothbrushes, the Office for National Statistics said.
It is the biggest jump in the cost of living since 1982, when Consumer Prices Index reached 10.4 per cent, according to ONS estimates.
It is also a massive jump from the 9.4 per cent inflation in June.
Tory leadership rivals Liz Truss and Rishi Sunak have faced calls to take urgent action to help tackle the cost-of-living crisis, even as No 10 ruled out any co-ordination between Boris Johnson and his two would-be successors for immediate solutions.
Mr Sunak’s campaign hit out at his rival on Tuesday, urging her to “come clean” on her cost-of-living plan. Meanwhile, Ms Truss has reiterated her plan to cut taxes for households and said she will reject “sticking plaster” approaches.
Welcome
Good morning and welcome to The Independent’s coverage of the cost of living crisis as the ONS this morning released the latest inflation figures revealing the largest rate in more than four decades.
Follow our blog for the reaction to today’s announcement and the pressures mounting on households across the UK.
Inflation soars to 10.1 per cent
Britain's rate of inflation has surged to a new 40-year high, heaping more pressure on households struggling with the cost of living crisis.
The Consumer Prices Index (CPI) rose to 10.1 per cent in the 12 months to July, up from 9.4 per cent in June and remaining at the highest level since 1982, the Office for National Statistics (ONS) said.
July's inflation rate is higher than the 9.8 per cent figure expected by most economists and represents a further squeeze on people's pockets.
Inflation is expected to peak later this year at 13.3 per cent and will push the UK into a recession, according to the Bank of England (BoE).
Which items drove the inflation increase?
According to ONS chief economist Grant Fitzner rising prices of a wide range of food products drove inflation to its decades high 10,1 per cent.
“A wide range of price rises drove inflation up again this month,” Mr Fitzner said.
“Food prices rose notably, particularly bakery products, dairy, meat and vegetables, which was also reflected in higher takeaway prices.
“Price rises in other staple items, such as pet food, toilet rolls, toothbrushes and deodorants also pushed up inflation in July.
“Driven by higher demand, the price for package holidays rose, after falling at the same time last year, while air fares also increased.
“The cost of both raw materials and goods leaving factories continued to rise, driven by the price of metals and food respectively.”
‘Getting inflation under control my top priority,’ Nadhim Zahawi says
Responding to the rise in inflation, chancellor Nadhim Zahawi said: “I understand that times are tough, and people are worried about increases in prices that countries around the world are facing.
“Although there are no easy solutions, we are helping where we can through a £37 billion support package, with further payments for those on the lowest incomes, pensioners and the disabled, and £400 off energy bills for everyone in the coming months.
“Getting inflation under control is my top priority, and we are taking action through strong, independent monetary policy, responsible tax and spending decisions, and reforms to boost productivity and growth.”
100,000 sign a petition calling for emergency budget
More than 100,000 people have signed a petition supporting a call by former prime minister Gordon Brown for an emergency budget to tackle the energy and cost-of-living crisis.
Campaign group 38 Degrees said the numbers wanting to sign shows how desperate people are for help in the wake of soaring inflation.
Strategic director Ellie Gellard said: “More than 118,000 people are backing Gordon Brown's call for an emergency budget to help hungry kids and stop families from freezing this winter.
“38 Degrees' polling shows two out of three people support all the measures he has put on the table to take control of this crisis - including extra help for eight million vulnerable families and cancelling the energy price rise.
“Britain is so much better than our leadership right now. While PM frontrunner 'do nothing' Liz Truss keeps families in the dark about whether any lifelines are coming, the message from the British public is clear: act big and act now.”
Millions face ‘dire financial situation,’ experts warn
Rocio Concha, director of policy and advocacy at Which?, said: “These figures underline the scale of the cost-of-living crisis and make clear that millions of people face a dire financial situation in the months ahead.
“With bills set to rise further, it's clear that the current level of cost-of-living government help will not be sufficient.
“Ministers must now move quickly to increase the amount of support for those who are struggling, and businesses in essential sectors, such as supermarkets, energy and telecoms, must also do everything they can to make sure customers are getting a good deal and extra support if they need it.”
Katherine Chapman, director of the Living Wage Foundation said: “Today's CPI figures - showing inflation climbing to a new 40 year high - means even more pressure on household budgets and no one will feel the pinch more than the UK's 4.8 million low-paid workers.
“The real Living Wage is the only wage rate calculated based on what it costs to lead a dignified life. The new rates, announced in September, will reflect the significant increase in the cost of living we're facing. We encourage all businesses who can afford to, to join our network of almost 11,000 organisations that are accredited as Living Wage employers and committed to always doing right by their workforce.”
Inflation figure used for rail fare rises rises to 40-year high
The inflation figure usually used to determine annual increases in some train fares has risen to its highest in nearly 40 years.
The Office for National Statistics data showed July's Retail Prices Index (RPI) inflation was 12.3 per cent, up from 11.8 per cent the previous month and the highest since January 1982.
July's RPI figure is traditionally used by the UK, Scottish and Welsh Governments to set the cap on the following year's increase in regulated train fares, which include most season tickets on commuter routes.
But the Department for Transport announced on Monday that the 2023 increase in regulated fares in England will be below the inflation measurement.
Chris Page, who chairs pressure group Railfuture, said: “The government claims that the fare rise will be below inflation, but the devil will be in the detail.
“They won't say what the increase will be, or which fares it will apply to.
“If the government was serious about tackling the cost-of-living crisis it would make rail travel much more affordable and make it easier for people to use cars and planes less.
“Germany has shown the way with its nine euro (£7.58) travelcard offer.
“It proves that if the price is right, people will flock to the trains.”
ICYMI: Liz Truss said British workers need ‘more graft’ and lack ‘skill and application’ of foreign rivals
Conservative leadership frontrunner Liz Truss been criticised after she said British workers needed ‘more graft’ in a leaked audio recording.
Ms Truss appeared to deny any knowledge of her own remarks after they were branded ‘offensive’ by Labour.
Tackled about the comments at the Tory leadership hustings in Perth, Scotland on Tuesday Ms Truss said: “I don’t know what you are quoting there.”
But hours earlier sources in her own campaign team suggested they were genuine, describing them as “half-a-decade-old”.
Read the full report below:
Liz Truss said British workers need ‘more graft’ and lack ‘skill and application’
Labour brand Tory leadership frontrunner’s comments ‘grossly offensive’
Javid says Labour plan ‘doesn’t add up at all'
On Labour leader Sir Keir Starmer’s plan to freeze the energy price cap, Conservative former cabinet minister Sajid Javid said “I don’t think his numbers added up at all”.
He told Sky News: “When you’re in Opposition you’re never going to be held accountable for what you say, so you say what sounds good. I listened to what Keir Starmer had to say yesterday, I don’t think his numbers added up at all.”
He added: “She’s (Liz Truss) thinking very carefully about the commitments, rightly so and she’s made some solid commitments, but one of those clearly is to have this emergency budget, as I say, will happen within weeks and to take further action.
“Nothing has been taken off the table because she recognises as I do and as I think most politicians do, is that this is a very, very serious crisis for families at home.
“They would have looked at that inflation number today and whilst it might not be a shock because of what the Bank of England said recently, that doesn’t make it any less palpable to anyone. People will be worried and Liz is going to be the right person to deal with this.”
Asked if support would be blanket or targeted, he added: “I think you don’t have to choose between the two… What she has said with the tax cuts, of course that will benefit everyone, but having a look at if targeted action can be taken, I’m sure that will be considered when it comes to the emergency budget.”
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